Amid the long-standing uncertainty about the hurdles since the Cove 19, companies are sitting on record sums, rejecting expectations earlier this year that declining epidemics would spur spending.
Cash and short-term investment on corporate balance sheets is at an all-time high of 6. 6.84 trillion, according to second-quarter earnings reports from S&P Global. This is 45 percent more than the average in the five years before the epidemic and 2.6 percent more than in the previous quarter.
In April, Goldman Sachs analysts raised their 2021 forecast for S&P 500 companies’ spending growth from 10% to 19%, “as uncertainty eased and global economies reopened. Are. ”
According to an August 6 report by JPMorgan Chase & Co., global capital spending is expected to decline in the third quarter after a strong start to the year, with corporate spending projected at 5.8% this quarter. Rate, down from 12.9% in the previous one.
Companies driven by a strong combination of financial and monetary stimulus have enjoyed a strong economic recovery of history. But now some signals are flashing warning signs and urging finance chiefs to rebuild their cash buffers.